"Given its significance for low-income populations and overall economic development, the international development community has long focused on the MSE sector. Yet much of what we know about MSEs remains theoretical; important knowledge gaps still exist. Despite decades of research, little is known about the unique characteristics of MSE owners, the trajectories of their businesses, and the role financial services play in supporting MSE owners and employees. Moreover, while research on microenterprises is extensive, it often relies on data such as the World Bank Country Indicators and Enterprise Surveys that exclude from their sample very small enterprises with fewer than five employees and informal enterprises, where much of the world’s poor population is concentrated. Consequently, insights on how MSEs sustain and expand livelihoods are based on the experience of larger, more formal MSEs while small, informal, and the poorest MSEs often remain excluded."

The publication was prepared by CGAP in English language. Click here to acces the publication.

Source: Sawhney, Swati, Sai Krishna Kumaraswamy, Nisha Singh, Elizabeth Kiamba, and Alexander Sotiriou. 2022. “No Small Business: A Segmented Approach to Better Finance for Micro and Small Enterprises” Focus Note. Washington, D.C.: CGAP.

Illustration: Francisco Javier Soto Plascencia/PRONAFIM, 2016 CGAP Photo Contest